Lifetime Costs and environmental benefits: HEV vs PHEV vs BEV

Researchers form Carnegie Mellon and Arizona State University have released a study that assesses the economic value of life-cycle emissions and oil consumption of Hybrids (HEVs like the Toyota Prius), Plug-In Hybrids (PHEVs like the Chevy Volt) and battery electrical vehicles (large battery pack versions like Tesla, Fisker, not Nissan Leaf). The environmental benefits of each type of vehicle technology is evaluated based on assumptions about the costs of oil, emissions from use and energy generation, and, battery technology improvements.

The widespread adoption of hybrid and electric vehicles of every flavor will lead to significant reductions in production of greenhouse gas emissions when using electric power depending on source; reduce gasoline consumption and reliance on foreign sources of oil; and reduce tailpipe emissions of GHGs and other noxious elements.

But as the authors show, the assumptions made about the future of battery technology, assumptions about the price of oil and alternative fuels, and, externality costs associated with battery/vehicle production lead to very different outcomes. It is useful to evaluate these assumptions as they have very different outcomes relative to the goals stated above. In the diagram CV = Conventional Vehicle, PHEV 20 = low-range battery hybrids, PHEV 60 refers to mid-range battery hybrids and BEV240 refers to long range battery only vehicles.

It was subject to a brief Bloomberg note here: US Battery, Plug-In Car Push Costs Exceed Rewards. And it is about what you’d expect when a substantial paper by academics is reduced to a sound byte quantity consistent with readers online appetite for news. The take away – government subsidies to promote electrical vehicle aren’t always effective ways to cut tailpipe emissions or reduce gasoline consumption. Buying a Prius Hybrid is a better deal economically and environmentally than a Volt – even after government incentives are applied to the later but not available for the former! Perhaps. As the full paper explores in detail – the answer to what type of vehicle is best economically and environment depends, as it usually does, on what happens in the future.

The paper itself is worthy of the effort to read – well documented, topical and very detailed. The Valuation of plug-in vehicle life-cycle air emissions and oil displacement benefits can be found at lead author Jeremy Michalek’s CMU website. It is being published by the Proceedings of the National Academy of Science and on the PNAS website it is the abstract only. And it covers the policy considerations the Feds and State actors make to encourage adoption of these modern vehicle types. The policy choices, as they often are, are based on assumptions about the future of technology advancements, costs, consumer behavior and subject to uncertainty and unknown/unrecognized factors.

From the study’s Conclusion:

Our results suggest that plug-in vehicles with large battery packs
may either reduce or create more life-cycle damages than HEVs
depending largely on GHG and SO2 emissions from electricity
and battery production. But even if future marginal electricity
production and battery manufacturing processes have substantially
lower emissions than today’s averages, the emission damage
and oil premium reduction potential of plug-in vehicles is small
compared to ownership cost..